There are three key legal documents found on websites:

  1. terms of use;
  2. terms and conditions; and
  3. privacy policy.

You should review all of these documents to ensure they are well-drafted and provide adequate protection to you as the owner of a website. This is because each serves a different purpose and provides a different level of protection for the relevant parties. Specifically, this article will discuss what a website’s terms of use document is, some of the standard terms used in the document and how you can enforce them.

Terms of Use or Terms and Conditions?

The terms and conditions document sets out the terms of sale of goods or services. It applies to people who purchase the goods and services. Some common clauses include:

  • a description of the goods and services provided;
  • the process of paying for or cancelling an order;
  • the business’ exchange and refund policy;
  • what to do in the event of a dispute; and
  • the limits of the business’ liability.

On the other hand, the terms of use document applies to everyone who visits the website. It sets out how people can use the website and addresses any disclaimers relating to the website’s content.

These are some of the common terms found in a website’s terms of use document.

Prohibited Conduct

The terms of use will have a list of prohibited conduct to ensure everyone who visits the website does the right thing. This conduct includes:

  • doing anything unlawful;
  • uploading private or personal information without a person’s consent, or anything that would constitute a breach of a person’s privacy;
  • using your website to harass or defame someone;
  • uploading viruses or any other behaviour that tampers with your website; and
  • posting public links to your website that would make others think that a partnership or affiliation exists.

Intellectual Property

Your website’s terms of use document may also include a term addressing intellectual property (IP). For example, it may detail who owns the content on the website, including:

  • photos;
  • videos;
  • music; and
  • articles.

Usually, your business will own the content on your website. If not, you might have a licence to use it. The IP clauses in the terms of use prevents people from copying, using or altering any of the content without your permission.

If a person posts or comments on your website, they might be providing a broad licence to you, as the website owner, to use what they have shared. It is also possible that you own the content that has been posted, if you have drafted an IP clause to provide for that.

Third-Party Disclaimers

Your website may also have links to third-party websites. This may be through native content or paid partnerships. Even if there is a paid partnership, your website will only have control over its own content and functions.

Therefore, a third-party disclaimer will mean you are not liable for anything associated with the third-party links. In this case, the visitor is responsible for conducting any investigations into the suitability of the third-party links.

Limitations on Liability and Indemnity

The terms of use will specify the limitations on your liability arising from a visitor’s use of your website. It might also state that the visitor should provide an indemnity against any claim, in the event they breach the terms of use. This means the visitor will need to compensate you for any harm, liability or loss you suffer as a result of their breach of your terms of use. 

Disputes

You may include a disputes clause in the terms of use. This clause outlines the process parties should take to resolve a dispute, in the event a visitor has a problem with the terms of use. Often, the visitor will need to provide written notice to you, detailing the dispute. The clause should also address when the visitor can expect to hear back from you, as well as the next steps in attempting to resolve the dispute.

How Are Terms of Use Enforced?

It is important to ask whether, in enforcing the terms of use, you provided visitors with reasonable notice of the terms. Another question is whether the visitors accepted the terms. There are two ways a terms of use document may be drafted to signify acceptance:

  • Browse wrap agreements are drafted to include a clause which states that, by accessing or browsing your website, a visitor agrees to the terms of use. It places the responsibility on the visitor to review the terms. For example, if they do not agree with your terms, they should stop using your website.
  • Click wrap agreements require a visitor to click on an “I Agree” box to indicate acceptance. Some click wrap agreements require the visitor to scroll to the bottom of the page before the “I Agree” box appears.

Reasonable notice and acceptance are easier to establish with click wrap agreements. This is because the visitor needs to go out of their way to accept the terms. However, this is not to say that browse wrap agreements are not enforceable. Although Australian courts are yet to consider this issue, a United States Supreme Court recently ruled that it is the responsibility of the visitor to read the terms before proceedings.

Key Takeaways

It is essential that you have a well-drafted terms of use document to ensure you are adequately protected. You should include some common terms in your document, such as a:

  • third-party disclaimer;
  • list of prohibited conduct;
  • IP clause; and
  • dispute resolution clause.

If you need assistance drafting your terms of use, contact LegalVision’s e-commerce lawyers on 1300 544 755 or fill out the form on this page.

Justin Ocsan
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